The German DAX index extended losses on Thursday, slipping 0.44% to 25,977 points by midday, falling below the psychologically significant 26,000 level. The decline extended the index’s recent downward trend, with the 21-day moving average providing temporary support.
The Euro Stoxx 50 also declined by 0.2%, while the MDax of mid-cap stocks remained flat. The DAX had reached a record high of 26,573 points the prior week, but momentum has since waned amid rising bond yields and climbing oil prices driven by escalating tensions in the Middle East.
US President Donald Trump’s threat of an unprecedented ‘economic war’ against Iran, amid stalled nuclear negotiations, added to market unease. Analyst Frank Sohlleder of ActivTrades noted that the DAX had initially weathered the ‘Asia shakeout’ earlier in the week but warned that the combination of higher energy costs and rate uncertainty could pressure the index further.
Corporate earnings provided limited support. Shares of Tonies, the toy manufacturer, fell 1.5% despite reporting a sharp revenue increase in the first half of the year. However, earnings metrics declined due to product mix effects and new US tariffs. Metzler analyst Felix Dennl highlighted that adjusted EBITDA exceeded consensus, though this failed to resonate with investors. Oliver Wojahn of MWB Research cited weak free cash flow development as a key weakness in the results.
Analyst actions drove notable stock movements. Sartorius shares surged 5.2% after UBS upgraded the stock to buy, citing premium growth warrants a premium valuation. Matthew Weston raised long-term revenue and earnings forecasts for the lab services and pharmaceutical supplier by an average of 3% through 2031.
Within the DAX, Continental led gainers with a 1.5% rise after JPMorgan’s Jose Asumendi upgraded the stock to overweight. Asumendi also upgraded Michelin to the same rating, citing robust monthly sales data and sustained profitability in the tire sector.
At the opposite end, Brenntag shares dropped 2.9% to €59.90 after Bank of America resumed coverage with an underperform rating and a €55 price target. Analyst Matthew Yates argued that post-conflict windfalls are fading and savings may not offset the decline in exceptional profits. He also questioned consensus earnings expectations for 2027.
Ströer shares fell 3% after Kepler Cheuvreux withdrew its buy recommendation, citing a lack of near-term catalysts beyond a potential bid from financial investors. Reports in May indicated that US private equity firm Blackstone was no longer pursuing a takeover.
